State lawyers fund pays back victims of fraud

A total of 187 people victimized by 60 lawyers were repaid $5.4 million in 2012, according to Timothy O’Sullivan, a spokesman for the state’s Lawyers’ Fund for Client Protection.

The overall sum includes $417,818 repaid to eight clients victimized in the eight-county Eighth Judicial District, based in Buffalo.

One client of lawyer Kenneth F. Bernas recouped $376 in legal fees last year. However, over the past three years the fund – financed by fees assessed to the state’s more than 298,000 registered lawyers – reimbursed 33 Bernas clients more than $1.2 million, O’Sullivan said.

Bernas, 56, has been incarcerated in Groveland Correctional Facility since 2011. He is serving a prison term of 2∑ to 7 years that State Supreme Court Justice Penny M. Wolfgang imposed upon his conviction on multiple grand larceny charges. Wolfgang also ordered Bernas to pay back another $1.8 million in the criminal case. He is not eligible for parole consideration until February 2015.

About $500,000 from the sale of a $2 million mansion Bernas had built in East Aurora was used to reimburse clients he defrauded over the years, O’Sullivan said.

Also last year, the fund repaid a total of $160,264 to a Grand Island woman and the estate of a Wheatfield man, both swindled by disbarred Niagara County attorney Robert J. Niemel, as well as $251,478 to three clients of former North Tonawanda lawyer David R. Schnell. Both lawyers received jail terms in those cases.

Also, the fund reimbursed a Buffalo couple the $4,300 they paid Buffalo attorney Richard L. Baumgarten for legal fees in an ineffective criminal appeal and $1,400 to clients of attorney Alan E. Fielitz of Lackawanna.

In 2009, Fielitz was sentenced to weekends in jail for defrauding six people who received $102,000 from the lawyers’ fund several years ago.

Baumgarten was suspended from practicing law but later reinstated and, at the time of his death in 2007, he was considered a lawyer in good standing, O’Sullivan said.

In its 2012 annual report, the seven-member board of the Lawyers’ Fund thanked the following Western New York lawyers for assisting victimized clients: John G. Brenon, Donna L. Haslinger, Robert E. Nicely, Mark E. Saltarelli and Douglas Trumpler of Erie County; Thomas D. Williams of Genesee County; and Richard I. Reitkopf and Brian Shiffrin of Monroe County.

The Lawyers’ Fund was created in 1982 by the Court of Appeals in Albany. Since then, it has paid out $163.7 million to 7,255 people victimized by lawyers statewide.

O’Sullivan pointed out that the most common cases are attorney thefts from real property escrow funds.